Editorial: The Unemployment Business

By Corporate Watch | Corporate Watch Magazine # 45 | Winter 2009-2010

It has almost become a self-evident truth that unemployment has been growing progressively over the last two decades, both in scale and in its significance for social and economic policy. How and why are often ignored but a vast industry to ‘manage’ this ‘crisis’ has developed. From flourishing private companies, such as A4e, contracted by the Department for Work and Pensions to deliver what Jobcentre Plus has apparently failed to achieve, through tens of subcontracted employment services providers, to a growing sector of so-called voluntary organisations that depend on this reserve army of unemployed people to source their ‘slave’ workforce. This double issue of the Corporate Watch Newsletter takes a look at this relatively new ‘unemployment business’; its protagonists, ideological, political and economic premises and how it is being utilised by the New Labour government to dismantle what’s left of the welfare state.

The ‘unemployment crisis’ has certainly been exacerbated by the recent economic downturn, with many employers going bust, but that’s not the whole story. Many big businesses have also exploited the current climate to push for compulsory redundancies. More importantly, the recession and the rising number of jobless people have been skilfully employed by politicians and government officials. By introducing new schemes and increasingly coercive measures to ‘help’ the unemployed get back into the job market, they have put yet another nail in the welfare state’s coffin.

The first article, The Welfare Crisis, discusses these deployments in more detail, providing some historical background on New Labour’s welfare reforms. Two other articles take an in-depth look at the New Deal programmes, both old and new, which have been at the core of these reforms, providing some new details and figures about the winners and losers, or the private contractors and their victims. The voluntarism business is discussed in depth in a separate article, again with some interesting details and figures. These are complemented by a shorter article on prison slave labour, which bears striking similarities to the increasingly coercive benefits and employment system, both in how it is working out and in the reasoning behind it.

Readers may notice, or be annoyed by, the rather excessive use of inverted commas in most of the articles. This is because one of the aims of this issue is not only to demystify the business jargon used to talk about employment and benefits, but also to pause and question the official terms and euphemisms that have come to be used by almost everyone without much questioning. To that end, we have included a list of the most common words and terms in this ‘benefits newspeak’, along with their real meanings.

Our other aim of this issue is to highlight how the reformed welfare system is being used by the state and the market for social control. During interviews conducted for the purpose of producing this newsletter, one of the “Jobcentre victims,” as he described himself, commented: “If they gave the money they spend on finding work for people to those people [on the dole], there wouldn’t be a crisis, would there?” No, there probably wouldn’t but, of course, it’s not only about money. Keeping people busy with work or looking for work also serves another political agenda: preventing time for politics, uninstitutionalised creativity and other ‘dangerous’ activities.

With all the talk about ‘flexibility’, people nowadays appear to have less freedom to choose what they really want to do, particularly those with less marketable skills. Forcing people to do whatever is available on the job market to survive means subjecting them to ruthless market mechanisms (everyone seems to accept terms like the ‘labour market’ as normal!). We have included an article about the rather small-scale acts of resistance by the unemployed and benefit claimants, but we are aware that much more could, and should, be done. We hope this issue is a useful contribution to this growing movement.